TIDMSMWH
RNS Number : 8699Y
WH Smith PLC
19 January 2022
WH Smith PLC
19 January 2022
Trading update for the 20 week period to 15 January 2022
Good progress across the Group; further store wins in North
America
Commenting on today's announcement, Carl Cowling, Group Chief
Executive said:
"We are pleased with the progress the Group has made in the
period.
"In Travel, we have focused on our strategic objectives of
increasing customer conversion, growing average transaction value
and winning new space, all of which continue to deliver good
results. We have now opened 16 of the recently won InMotion
technology stores in UK airports and are pleased with their
performance. Our strong track record of winning new tenders in the
US continues, with a significant nine store win at Kansas
airport.
"Our High Street business performed well, in line with our
expectations, with our online businesses delivering strong
performances.
"As we enter our 230(th) year since the Company's founding in
1792, I would like to thank our entire team across the globe. In
particular, my thanks go to our store colleagues who have worked
tirelessly over the past number of weeks throughout such a busy
trading period. We have an exceptionally strong team at WHSmith and
we look forward to building on the strong foundations we have in
place.
"Looking ahead, although we are seeing a small impact from the
Omicron variant, we anticipate a resumption in the recovery of our
Travel markets over the coming months. We are well placed for the
key trading period in Travel this summer and the ongoing recovery
in our markets."
Trading Update
The Group has delivered a good performance over the 20 week
period. Prior to the emergence of the Omicron variant of Covid-19,
we saw a consistent and encouraging recovery in our key Travel
markets. In High Street, we adapted well to the evolving trading
environment and delivered a good performance, despite reduced
footfall.
For the 20 weeks to 15 January 2022, total Group revenue was 85%
of 2019 revenue for the period.
Total Group revenue as a percentage of 2019 total revenue has
been:
% of 2019 Revenue(1)
------------ ---------------------
High Street Travel Group
------------ --------------------- ------
September 2021 89% 73% 79%
------------ --------------------- ------
October 2021 87% 84% 85%
------------ --------------------- ------
November 2021 85% 94% 90%
------------ --------------------- ------
December 2021 90% 83% 87%
------------ --------------------- ------
Year to date 87% 83% 85%
------------ --------------------- ------
(1) Equivalent month in 2019
Travel UK
In Travel UK, total revenue was 70% of 2019 revenue for the 20
week period. Prior to the emergence of the Omicron variant in early
December, we saw a consistent and encouraging improvement in sales
trends across all our channels which was followed by a resilient
performance in December. We welcome the Government's relaxation of
the testing regime for arriving passengers.
% of 2019 Revenue(1)
Air Hospitals Rail Total
---- ---------- ----- ------
September 2021 42% 87% 71% 60%
---- ---------- ----- ------
October 2021 59% 92% 74% 71%
---- ---------- ----- ------
November 2021 71% 91% 74% 78%
---- ---------- ----- ------
December 2021 65% 94% 69% 74%
---- ---------- ----- ------
Year to date 58% 89% 70% 70%
---- ---------- ----- ------
We have made good progress in opening our recently won InMotion
technology stores in UK air. We have now opened 16 of the 30 stores
that we have won, including stores at London Heathrow, London
Stansted, Manchester and Edinburgh airports. Initial reaction from
customers and landlords has been very positive. We anticipate
opening the remaining stores, which include further stores at
London Heathrow and London Gatwick airports, prior to the peak
trading period over the summer months. In addition, we have opened
our first combined WHSmith pharmacy format in rail, at London
Euston Station, and early customer and landlord feedback has also
been positive.
Our key initiatives continue to deliver. We have increased
average transaction values and expanded categories during the
period, for example, in pharmacy and tech accessories ranges. This
puts us in a strong position ahead of our peak trading period in
the summer.
Travel - North America
In North America, we continued to see an improvement in air
passenger numbers over the period and through the holiday season
with Transportation Security Administration ('TSA') data for the
week ending 1 January 2022 down 17% compared to 2019. Our resorts
business in Las Vegas also benefited from improved visitor numbers.
We have seen a small impact from the Omicron variant in January
but, as elsewhere, we believe this will be short-term.
Our strong track record of tender wins continues. In the period,
we won a further 13 new stores, including three InMotion stores and
a significant tender at the new Kansas City airport to operate nine
stores for 15 years. We now have over 60 stores won and due to open
in North America over the next three years.
Overall revenue in North America for the 20 week period on a
proforma basis was at 92% of 2019 levels.
Travel - Rest of World
Outside of the UK and North America, we have seen broadly
similar trends to UK air, with a good recovery over the period
September to December 2021 in Europe, with some softening
thereafter following the impact of the Omicron variant. Asia
remains the slowest recovering region. We are on track to open our
first two InMotion stores at Dublin Airport in the spring.
High Street
In High Street, total revenue was at 87% of 2019 revenue for the
20 week period, in line with our expectations. Our online
businesses, funkypigeon.com, cultpens.com and whsmith.co.uk
performed strongly over the 20 week period. Through the peak
period, we maintained good stock availability and we exited
Christmas with a clean stock position. Our cost savings target for
the full year is on track and our gross margin has improved, driven
by mix.
Liquidity
As a result of our trading performance, our cash generation for
the first 20 weeks was ahead of plan. As at 31 December 2021,
access to liquidity was GBP345m being cash on deposit of GBP95m and
the undrawn RCF of GBP250m.
Outlook
We have a very strong pipeline of store openings with over 30
new stores opened in the period and 99 new stores won and due to
open in Travel over the next three years.
Although we are seeing a small impact from the Omicron variant
since the start of December 2021, we anticipate, subject to no
further restrictions, our Travel markets will recover further
through the spring and we are well placed for the key trading
period in Travel over the summer and beyond.
Interim Results Announcement
WH Smith PLC will announce its 2022 Interim results on Wednesday
27 April 2022.
Enquiries:
WH Smith PLC
Nicola Hillman Media Relations 01793 563 354
Mark Boyle Investor Relations 07879 897 687
Brunswick
Tim Danaher 020 7404 5959
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